Virgin Blue suspends direct Sydney-Canberra flights, increases Fuel Surcharge

Virgin Blue is to increase its fuel surcharge fee from next month as a result of record high oil prices. Domestic flight surcharge will go from A$6 per sector to A$10, while the surcharge on International flights will increase from $10 to A$20*.

The low fare airline introduced the surcharge three months ago in line with other airlines around the world, who have now also moved to increase the charge, as the cost of jet fuel soars over $55 per barrel, nearly double what it was two years ago.

The increased surcharge will come into effect after midnight on 26 August so anyone making a booking between now and midnight on August 25 will only be charged the existing surcharge.

Head of Communications and Strategy, David Huttner, said “Like many airlines globally, Virgin Blue’s low fare mantra is being challenged by sky high fuel prices. We regret having to pass the cost on to the travelling public but, as a low fare airline, it is not viable for us to absorb such exorbitant increases in our costs. Virgin Blue is still determined to be the low fare leader wherever we fly in Australia, New Zealand and the South Pacific. It is important to note that despite today’s sky high fuel prices, the cost of flying is still dramatically lower than when we started four years ago. This is true, even taking into account increases in CPI, the 10% impost of GST and the more than doubling of charges at a number of monopoly airports.”

The airline said it will continue to monitor the situation and will consider reducing or scrapping the fee if fuel prices return to previously budgeted levels.

Separately, Virgin Blue has confirmed it will suspend its Sydney-Canberra service as of Saturday 4 September. The aircraft is being redirected to Tasmania where the demand for Virgin Blue product and service has seen a notable increase.

“We have always made it very clear that, as a low fare airline, we can’t and won’t continue to operate on routes that aren’t strongly trending towards profitability. While we apologise to our numerous cost conscious loyal supporters on the Sydney-Canberra service, we will not sustain a service where the dominant customer isn’t giving all suppliers a fair go,” David Huttner finished.